Culver City, Calif., and Austin, Texas — Sony Pictures Entertainment has acquired theater chain Alamo Drafthouse Cinema from Altamont Capital Partners, Fortress Investment Group and founder Tim League for an undisclosed price.
Alamo Drafthouse was founded in 1997 in Austin, Texas, and has grown from a single mom-and-pop location to 35 cinemas across 25 metropolitan areas. The company is the seventh-largest theater chain in North America and was one of the pioneers of the in-theater elevated food and drink concept.
Alamo Drafthouse will maintain its headquarters in Austin and will continue to operate all of its locations, as well as the company’s Fantastic Fest film festival, which was included in the acquisition. Sony will manage these entities under a newly established division, Sony Pictures Experiences, led by Alamo Drafthouse CEO Michael Kustermann.
The acquisition is groundbreaking, as it was recently made possible through the Department of Justice’s decision in 2020 to rescind the Paramount Decrees. Put into place by the U.S. Supreme Court in 1948, the Decrees mandated a separation between film distribution and exhibition, requiring major motion picture studios to divest of any theater holdings.
“We are excited to make history with Sony Pictures Entertainment and have found the right home and partner for Alamo Drafthouse Cinema,” says Kustermann. “We were created by film lovers for film lovers. We know how important this is to Sony and it serves as further evidence of their commitment to the theatrical experience. Together we will continue to innovate and bring exciting new opportunities for our teammates and moviegoers alike.”
Alamo Drafthouse has seen its share of difficulties over the past few years, filing for bankruptcy protection in 2021 amid struggles during the COVID-19 pandemic. The company also made news earlier this week for closing five of its location in the Dallas-Fort Worth metropolitan area.
Goldman Sachs & Co. LLC acted as exclusive financial advisor to Alamo Drafthouse in the transaction.
Culver City-based Sony Pictures Entertainment is a subsidiary of Tokyo-based Sony Group Corp. The company’s global operations include motion picture and television production, acquisition and distribution; the operation of studio facilities; and the development of new entertainment products.
—Katie Sloan
SOURCE: www.REBusinessOnline.com